It is said that the biggest advantage of filing a limited liability company is that it protects you personal assets. Another advantages are it gains potential benefit on tax and using the LLC abbreviation on your business name which maximize the credibility of your company. The LLC Florida is mix with the protection of corporation’s liability, ease of partnership and tax treatment. All of the information can be read here at Sunbiz website. But no matter how good the feedback of any business structure, there will be disadvantages too. Here in this article is an honest feedback about this company.
- Flexibility. The company has to restriction over the number of shareholders and companies to be allowed as members. It has a structuring management to the members that are flexible too. It selects different kinds of distribution for profits. Not like other Florida corporations that have equal share, LLC has more room for opportunity.
- Pass-through taxation. The company sidesteps on the double taxation that is incurred by S Corp when an income is being taxed. The members will report their share on the LLC as individual tax return.
- Fewer formalities. The entity does not use any resolutions or minutes to have an easy management. But they still hold yearly meeting and documentation of large business transactions.
- Not much protection on case law. Since the LLC is a newer business entity, it does not hold much case law.
- Filing fees. The company is expensive than the most partnership and sole proprietorships.
- Limits on the ownership transfer. When it comes to ownership, it is hard to transfer than the corporation. As a member, you should one by one outline the agreement of LLC if it can be transferable or require member’s approval.
These are the good and drawbacks of forming LLC. That is why there is an ongoing debate for llc vs s corp.